Algae biofuels start-up space triples as pilot projects get underway

The number of algae biofuels start-up companies more than tripled between 2005 and 2009, leading to a sharp rise in the number of pilot and commercial-scale facility projects, according to new research.

Before 2000, there were roughly ten companies around the world pursuing the development of algae biofuels as their sole business area or in relation to other business operations such as algae production or renewable fuels.

By 2009, the number of companies involved in the development and implementation of algae biofuels technologies had grown to more than 60 worldwide, the Algae Biofuels Production Technologies Worldwide report said.

In addition, involvement in the algae biofuels industry as a whole increased by 550 per cent between 2005 and 2007, fuelled by environmental concerns and high crude oil prices.

Robert Eckard, analyst at SBI Energy and author of the report said algae can be cultivated and harvested in support of a wide array of biofuel products.

‘In addition, algae biofuels systems hold promise to enable rapid production of high quality, high throughput biofuels systems in support of carbon emissions reductions targets, and in support of clean fuel production.

‘The US Department of Energy’s recent $24m commitment to a trio of research groups determined to bring algae biofuels to market indicates just how much potential this industry holds.’

The algae biofuels market is currently pursuing pilot and demonstration-scale algae cultivation projects and the report said these pilot schemes are expected to continue through to 2015.

To date, most development is within the US with small peripheral markets in the European Union (EU) and Asia are expected to emerge through collaborations with companies based in that country, the report said.

The US dominance is forecast to represent more than 80 per cent of the global market for open pond algae cultivation from 2010 to 2015, with the EU expected to gain a market share of 11 per cent and Asia the remaining seven per cent.

The report said through to 2015, cultivation technology sales are expected to hold most of the total algae biofuels production technologies market. Alongside this, the remaining market segments will be held by a combination of harvesting, extracting and fuels production facilities, with a total projected market value of more than 1.6bn in 2015.

With a market size of about $271m for 2010, the report said this increase is significant and underscores that this is a quickly changing and evolving industry, expected to show an annual growth rate of almost 43 per cent.